Foulds Company makes 5,000 units per year of a part it uses in the products it manufactures. The unit product cost of this part is computed as follows:

Direct materials	$	12.00
Direct labor		19.60
Variable manufacturing overhead		1.80
Fixed manufacturing overhead		9.70
Unit product cost	$	43.10

An outside supplier has offered to sell the company all of these parts it needs for $41.10 a unit. If the company accepts this offer, the facilities now being used to make the part could be used to make more units of a product that is in high demand. The additional contribution margin on this other product would be $38,000 per year.

If the part were purchased from the outside supplier, all of the direct labor cost of the part would be avoided. However, $6.40 of the fixed manufacturing overhead cost being applied to the part would continue even if the part were purchased from the outside supplier. This fixed manufacturing overhead cost would be applied to the company's remaining products.

Required:
a.	How much of the unit product cost of $43.10 is relevant in the decision of whether to make or buy the part? (Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Relevant cost per unit

$

b.	What is the net total dollar advantage (disadvantage) of purchasing the part rather than making it? (Input the amount as a positive value. Omit the "$" sign in your response.)

Net (Click to select)advantagedisadvantage

$

c.	What is the maximum amount the company should be willing to pay an outside supplier per unit for the part if the supplier commits to supplying all 5,000 units required each year? (Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Maximum acceptable purchase price per unit

$

...................................................................................................................................................................................................

Wright, Inc. produces three products. Data concerning the selling prices and unit costs of the three products appear below:

	Product
	C			D			E
Selling price	$	90		$	70		$	100
Variable costs	$	65		$	55		$	70
Fixed costs		30			7			27
Tapping machine time (minutes)		20			6			6

Fixed costs are applied to the products on the basis of direct labor hours. Demand for the three products exceeds the company's productive capacity. The tapping machine is the constraint, with only 2,800 minutes of tapping machine time available this week.

Required:
a-1.	Calculate the contribution margin per minute for all three products. (Round your answers to 2 decimal places. Omit the "$" sign in your response.)

	C	D	E
Contribution margin per minute	$	$	$

a-2.

Given the tapping machine constraint, which product should be emphasized? Support your answer with appropriate calculations.

	Product C
	Product D
	Product E

b.	Assuming that there is still unfilled demand for the product that the company should emphasize in part (a) above, up to how much should the company be willing to pay for an additional hour of tapping machine time? (Omit the "$" sign in your response.)

Maximum amount

$ per hour